Market outlook: How will D-Street react to Alaska meeting, GST announcement? Here is what experts say

Markets are set for a strong start on Monday, with both global and domestic factors likely to lift investor sentiment. The twin triggers include Prime Minister Narendra Modi’s Independence Day announcement of GST reforms and the “understanding” reached between US President Donald Trump and Russian President Vladimir Putin.The Alaska meetingTrump and Putin held a close to three-hour meeting in Alaska, which, even though, did not produce a ceasefire in the Russia-Ukraine conflict, ended with what Putin described as an “understanding”.Trump called it a "very good meeting" but stressed that “there's no deal until there's a deal.” He added, "We had a very good meeting today, and I think a lot of points were negotiated on behalf of Ukraine. There's no deal until there's a deal," noting that he plans to speak with Ukrainian President Volodymyr Zelenskyy and European leaders soon.Putin, meanwhile, cautioned Europe not to “torpedo the nascent progress.”GST reforms announced by PM ModiOn the domestic front, markets are expected to react positively to PM Modi’s pledge of rate cuts under GST 2.0 by Diwali. Speaking from the Red Fort on Independence Day, Modi announced that GST rates will be lowered on everyday-use goods as part of reforms to the eight-year-old tax system.Quoting Finance Minister Nirmala Sitharaman, PTI reported that the government plans to introduce two slabs, standard and merit, plus special rates for certain items, replacing the current four brackets of 5%, 12%, 18% and 28%, while luxury and sin goods will continue to attract an additional duty.

Market reaction to Trump-Putin meetingKranthi Bathini, director-equity strategy at WealthMills Securities, said the meeting between Trump and Putin is a positive development. “These are complex problems and cannot be resolved in one meeting. The agreement to meet again with calm markets," Bathini told ET.Anuj Gupta, Director at Ya Wealth Global Research, pointed to Trump’s statement about delaying tariffs on China for buying Russian oil as another encouraging sign.

Gupta noted that India, another large buyer of Russian crude, has faced a total 50% tariff and penalties on Russian imports but was not mentioned this time.Sunny Agrawal, head - retail fundamental desk at SBI Securities, said the absence of any fresh negative development is a relief. He said that Trump's statement that “he will not have to think of retaliatory tariffs on countries buying Russian oil right now but may have to in two or three weeks” now offers at least a temporary relief to countries like India." He told ET that the additional 25% tariff on India scheduled to begin on 27 August may now be on the backburner.Christopher Wood, global head of equity strategy at Jefferies, said the Trump administration’s 50% tariff on Indian imports is not a reason to sell. Instead, he argued, it’s an opportunity to buy. "It is only a matter of time before Trump backs off the stance, which is not in America's interest.” How will GST impact marketsAgrawal of SBI Securities said the move to a two-slab GST structure (5% and 18%), plus a 40% slab for sin products, will support consumption. "Few categories like large TV, AC, cement, automobiles, etc are likely to get cheaper, as they are shifted from 28% category to 18%. Moreover, reduction in GST rates on insurance products also will ease burden on consumers. Cheaper cement prices can have a multiplier effect on various sectors like real estate, roads/highways/infra as cost of production is likely to reduce and the same can be passed on to the consumer," he told ET.He cautioned, however, that the reforms must be implemented quickly. If not, festive season sales could be delayed as consumers wait for lower prices, temporarily affecting demand.Gupta and Bathini also praised the move, saying GST relief during the festive season will spur consumption and aid the wider economy, with FMCG and autos likely to gain.Market outlookIndian equities broke a six-week losing streak last week, finishing with gains of over 1%.

Experts believe Monday’s session will reflect optimism from both global and domestic developments.Santosh Meena, Head of Research at Swastika Investmart, said the Nifty is forming a strong base. "The immediate resistance lies at the 20 and 50-day moving averages (DMAs) clustered around 24,700-24,800. A decisive break above this level could trigger a short-covering rally towards 24,950, 25,080, and 25,225. Immediate support is at the 100-DMA of 24,575, with the crucial support level remaining at 24,350," he said.Anand James, chief market strategist at Geojit Investments, however, expects further weakness. "Directional moving indicators are still in favour of more downsides with 24,000 and 23,560 as potential downside supports attracting prices lower," he said.He added, "That said, the last week saw several attempts to push higher, giving us reversal hopes. Apparently none of those moves managed to successfully close above the 24670-720 band, the near term congestion resistance, they did manage to bring parabolic sar under the price, lending a positive bias."The analyst further said that the market has shown even better signs of resilience having had the highest number of Nifty 500 constituents closing above 10 day SMA, since 24th July. "Incidentally, the Nifty had tumbled from the 25,200 region on that day. This would be the objective we would be aiming, should we clear above 24,720 on Monday."